In an era of high-tech electronic gadgets, the Soviet Union's old-fashioned mechanical watches are conquering fashion-crazy Italy.

Genuine Soviet-made watches are selling in classy Italian jewelry shops as fast as the Soviets can produce them.Less than five months after the first Cyrillic-inscribed "Made in the USSR" time pieces crossed the border, the Soviet watch industry has received the highest of accolades - thousands of fakes are appearing on the streets.

The Soviet Union has long been the world's third largest producer of clocks and watches after Switzerland and the Far East, but until last fall exports were confined to selling parts and movements to Western makers.